U.S. Dollar Index

U.S. Dollar Index Futures (DX) Technical Analysis – May 29, 2019 Forecast

The U.S. Dollar is trading higher against a basket of currencies on Wednesday. The dollar is posting gains against the Euro, British Pound and Canadian Dollar and losses against the safe-haven Japanese Yen and Swiss Franc.

The price action is being fueled by a further escalation in the trade conflict between the United States and China, which is prompting investors to trim positions in the higher-yielding Euro, Pound and Loonie, while driving up demand for the safe-haven Yen and Swiss Franc.

The focus for investors is yields. A wave of risk aversion is hitting the markets with investors from New Zealand to Germany to the United States, rapidly moving money into sovereign bonds. This is sending yields sharply lower. New Zealand bond yields hit a record low and U.S. Treasury bond yields are at their lowest levels since September 2017.

At 09:19 GMT, June U.S. Dollar Index futures are trading 97.895, up 0.053 or +0.05%.

U.S. Dollar Index
Daily June U.S. Dollar Index

Daily Technical Analysis

The main trend is up according to the daily swing chart, however, momentum shifted to the downside on May 23 with the formation of the closing price reversal top at 98.260. The main trend changes to down on a trade through 96.810.

The minor trend is up. A trade through 97.410 will change the minor trend to down. This will reaffirm the shift in momentum to the downside.

The short-term range is 98.260 to 97.410. Its 50% level or pivot at 97.835 is controlling the direction of the index today.

The intermediate range is 96.810 to 98.260. Its retracement zone at 97.535 to 97.364 is support. This zone stopped the selling on May 24 at 97.410.

Daily Technical Forecast

Based on the early price action, the direction of the June U.S. Dollar Index the rest of the session is likely to be determined by trader reaction to the short-term pivot at 97.835.

Bullish Scenario

A sustained move over 97.835 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into last week’s high at 98.260. A trade through this level will negate the closing price reversal top and signal a resumption of the uptrend.

Crossing to the strong side of the uptrending Gann angle at 98.31 will put the index in a bullish position.

Bearish Scenario

A sustained move under 97.835 will signal the presence of sellers. The first target is a steep uptrending Gann angle at 97.560, followed by a short-term 50% level at 97.535.

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.